Answered step by step
Verified Expert Solution
Question
1 Approved Answer
E7-25 (similar to) s Question Help Lambeth, Inc. produces the basic fillings used in many popular frozen desserts and treats-vanilla and chocolate ice creams, puddings,
E7-25 (similar to) s Question Help Lambeth, Inc. produces the basic fillings used in many popular frozen desserts and treats-vanilla and chocolate ice creams, puddings, meringues, and fudge. Lambeth uses standard costing and carries over no inventory from one month to the next. The ice-cream product group's results for June 2017 were as follows: (Click the icon to view the results.) Read the requirements. Requirements 1 and 2. Calculate the static-budget variance in units, revenues, variable manufacturing costs, and contribution margin. What percentage is each static-budget variance relative to its static-budget amount? Break down each static-budget variance into a flexible-budget variance and a sales-volume variance. Begin with the flexible budget columns, then enter in the sales volume variance and static budget variances. Finally, compute the static budget variance as a percentage of the static budget. Label each variance as favorable (F) or unfavorable (U). (For variances with a $0 balance, make sure to enter "0" in the appropriate field. If the variance is zero, do not select a label. Round dollar amounts to the nearest whole dollar and percentages to two decimal places, X.XX%.) Flexible- X Data Table Actual Budget Flexible Results Variances Budget Units (pounds) Performance Report, June 2017 Revenues Actual Static Variable mfg. costs Results 360,000 Budget 348,000 Contribution margin Units (pounds) Revenues $ 1,839,600 $ 1,400,400 1,809,600 1,322,400 Variable manufacturing costs $ 439,200 $ 487,200 Contribution margin Choose from any list or enter any number in the input fields and then click Check Answer. Brian Baum, the business manager for ice-cream products, is pleased that more pounds of ice cream were sold than budgeted and that revenues were up. Unfortunately, variable manufacturing costs went up, too. The bottom line is that contribution margin declined by $48,000, which is less than 3% of the budgeted revenues of $1,809,600. Overall, Baum feels that the business is running fine. 5 parts remaining Clear All r
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started